Question: Instructions US UK Wheat 6 3 Cloth 4 2 Using one hour of labour time US produces 6 units of wheat or 4 units of

Instructions

US UK

Wheat 6 3

Cloth 4 2

Using one hour of labour time US produces 6 units of wheat or 4 units of Cloth

UK can produce 3 units of wheat or 2 units of cloth.

Q1) Identify which country has a comparative advantage in which commodity.

Q2) Will trade take place between the countries ? Justify your answer.

Please provide 10 points.

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